Fiat Chrysler Automobiles on Monday finally priced its initial price offering for Ferrari at $48 and $52 per share for 10 percent of the luxury carmaker when its stock goes sale, the Detroit News reported. The pricing values Ferrari at roughly $9.8 billion — less than the $12 billion reported last week — and analysts say the interest in the stock, which will trade under the symbol RACE, is roughly 10 times higher than available shares.
The IPO is part of FCA's long-term strategy to raise cash for investment in its own vehicles in Jeep, Dodge, Fiat, Chrysler and Maserati brands. According to paperwork filed ahead of the IPO, 10 percent of the company will remain with Ferrari scion Piero, 80 percent will be distributed among Fiat family ownership.
FCA CEO Sergio Marchionne has lobbied investors to find value in Ferrari beyond the automaker's limited production. Although the automaker disclosed that it would increase production of its supercars to 9,000 cars by 2019 — Ferrari makes roughly 7,000 cars now — that limited supply is a still profit liability for investors.
Marchionne recently said that Ferrari should be considered more as a luxury brand rather than a traditional automaker.
In the company's initial filing with the Securities and Exchange Commission earlier this year, Ferrari stated its performance and return for investors would hinge heavily on its Formula 1 team and licensing deals.
The post Your First Ferrari (Share) Priced As Low As $48 appeared first on The Truth About Cars.
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